Optimize the Choice of Counteragent Based on the Application of the COSO Internal Control Model

Abstract

The financial security of trading companies depends on the management of their assets, liquidity and solvency. The authors in this article recommend the formation of an internal control system using the COSO's international approach (The Committee of sponsoring organizations of the Treadway commission (COSO), which will help ensure efficiency a company's activities on the market. When companies are planning their business activity they may not be able to adequately assess the current level of financial security of potential foreign counteragent. This article describes the results of improved internal control of receivables using COSO's international approach. The organization may lack its own financial resources if the turnover period for receivables is high and dynamics increase. In this case, companies usually resort to short-term loans or delay payments to their creditors. Such a situation violates trust relations with suppliers, financial sanctions arise for delaying payments and other negative consequences affecting the company's business activities. Therefore, the solvency of the business entity and its business reputation depends on how quickly the funds invested in receivables turn into real money. 1. Introduction

The Maximization of State Non-Tax Receivables Management at The Directorate General of Law Enforcement on Environment and Forestry

“…From the results of the identification of existing factors and based on the analysis of the findings of the implementation of receivable management, according to the researcher, as the first step, it is necessary to develop a strategic design for PNBP receivables management internally in the Director General of PHLHK to assist the organization in achieving the objectives of the overall operation such as financial reporting and compliance with existing regulations as well as the tool to conduct evaluation/monitoring. This finding is in line with research by Sutriani (2017); Selezneva et al (2020); Suryadinata et al, (2018).…”

“…The role of control over accounts receivable managers has to be increased so that they can maintain discipline and professionalism at work because internal control largely determines the quality of the results of the performance that has been carried out in overcoming the bad credit problem (Suryadinata et al, 2018;Selezneva et al, 2020). But then Adusei (2017) also added that poor monitoring and lack of adequate follow-up are the main challenges in managing receivables.…”

Internal Control System Quality and Decision-Making Success: The Role of the Financial Information Quality

“…For Rashedi and Dargahi [35] (p. 33), "control objectives are to keep information systems function maintaining information confidentiality". Internal control systems play an important role in prevention, risk discovery and contribute to Financial Information Quality [36]. However, according to the American Institute of Certified Public Accountants (AICPA) [37], internal control systems mainly allow minimizing the risk of unintentional errors or intentional fraud.…”

“…According to International Auditing Standards, the internal control system should be the basis of each company's development plan, which should help it to properly organize and control all its activity [33]. However, for effective control, the internal control system must ensure the efficiency of the company's operations, compliance with financial and operational indicators, the safety of assets, and the credibility of financial reporting, as well as compliance with the law [36].…”

Assessing the efficacy of employee training and internal control system on financial management of small and medium scale enterprises in Nigeria

“…An effective internal control system ensures accuracy and reliability of accounting information, secure compliance policies and performance evaluation of an organization (Tetteh et al, 2021). It also helps to quickly identify and minimize risk (Selezneva et al, 2020). An internal control system is a system designed to safeguard assets, ensuring accuracy and reliability of information and increasing the effectiveness of an entity's operations (Kumari and Weerasooriya, 2019).…”